Market top?

A soft week has many feeling that the market is at a high. So those who bought months ago or more probably are easing back on the throttle. But there are always the usual suspects that buy at market highs. This is history repeating itself. It happens over and over again. Amusing but also sad. But market forces and freedom to make decisions will have people do all sorts of strange things. I am not saying this is the top but it is not far off.

So what we have here is a 90 day Elliott with an oscillator. This at the moment a textbook Elliott wave four recovery. The oscillator is at zero and there are all indications that wave four could be complete.

Would you buy if wave four is complete and heading to wave five? Yes but bear in mind the move for the All Ords is probably only about 6%. And moves for some stocks would be less and some may still continue their path south. Others maybe well increase by more than 6%. So it is a matter of sorting through the charts.

Note the 6% is based on the first wave five. The likelihood of a second and third wave five is not high – but it could happen. The 300 day Elliott takes a more conservative view: